Original Equipment Manufacturer (OEM): How to Monitor Machines & Provide Better Service
If you’re an original equipment manufacturer (OEM), it’s easy to see why monitoring customer machines offers some big benefits for sales teams. However, many of the original equipment manufacturers we work with are actually most excited about the customer service attributes they’ve gained by being able to monitor machines in customer plants.
- Below, I’ll run through how to monitor machines and provide better service to customers.
- I’ll also highlight how this can become an additional stream of revenue.
- And, I’ll explain how we’ve seen OEMs structure these kinds of models in the past.
As far as we can tell, most OEMs could deliver better customer service with customer machine data. This not only provides better service, but it also offers a lot of opportunities to increase sales, add additional revenue, prove ROI, and improves the way OEMs develop and provide feedback.
“Why Do I Need to Monitor Customer Machines?”
Machine manufacturers can show their customers how they provide benefits better than competitors if they can display actual data surrounding their current machine performance. This is how they can ACTUALLY demonstrate… REAL ROI (return on investment).
Here’s the challenge. Without hard data, demonstrating ROI to customers becomes about trust; which is great if you have a relationship with the customer and are always able to close new deals. The challenge is earning that trust.
This is why we’ve seen machine monitoring on customer shop floors become such a popular trend among original equipment manufacturers recently. (See “What is OEM Analytics?” to learn more about the solution.)
The ability to showcase exact figures around how a machine performs delivers hard data on the ROI that will be achieved by leveraging the original equipment manufacturers’ machines on customer plant floors.
“How Do I Setup Customer Machine Monitoring?”
Most OEMs can think of more than one reason why they would like to monitor customer machines. Unfortunately, this has not always been an easy, seamless, or straightforward process.
Customers will often have concerns about firewalls, access to their networks, and other security-based concerns. These concerns are often hang-ups even when there is inherent value in monitoring the machines for the customer. Fortunately, new lightweight hardware and software that circumvents these kinds of concerns have become increasingly available to OEMs.
Mingo OEM Analytics has emerged as one of the easiest of these types of solutions; providing a combination of software and hardware that is both easy to set up and affordable for just about any kind of OEM. The affordability and ease of implementation for these kinds of solutions have made it really hard for most OEMs to turn their heads away from the value of these kinds of capabilities.
Why Customer Machine Monitoring Increases Sales for OEMs
Original equipment manufacturers are essentially selling a mixture of three things to their customers. These three things are what allows them to stand apart from their competitors and help them ensure that the market for their machines isn’t viewed as a commodity marketplace. These are:
In certain circumstances, there may be some other ones we could tag onto that list, but for the majority of original equipment manufacturers, these are the big 3.
How Does Machine Monitoring Improve Customer Service?
OEMs that can respond more quickly to customer issues have the opportunity to achieve a whole host of new benefits. Here are some of the most common in the marketplace today:
- Notifying a customer of a potential issue before it becomes a big problem.
- Recognizing trends over time for a particular model across all customer sites to understand how to improve future models or find and fix recurring issues.
- Dig deep into the details of specific machines to understand exactly how a machine was running when it went down.
- Perform fast remote diagnostics; saving the customer money (uptime, etc.) and delivering service in a much more cost-effective way.
- Deliver best-practices information to customers based on past behaviors and aggregate customer machine data
- Perform preventative maintenance on a personalized, data-based schedule.
How Does This Become an Additional Revenue Stream?
Imagine the ability to sell customers all of the above benefits; more specifically, the ability to save them money by selling them parts and services before they experience an issue that would be far more costly than the service or parts you’re offering.
Additionally, imagine the ability to monitor a customer’s current machine performance, trends, and data. You would be able to provide advanced consulting and service around how to better utilize the machine, or may be able to deliver insights about when it might make sense to upgrade machines or purchase additional equipment.
These are the types of additional revenue models that OEMs are exploring now that they have access to this level of customer machine data.
Selling Real Machine ROI
Just about everyone sells their product based on the premise that it will generate some form of ROI (time, money, efficiency). OEMs are no different. The key to sales growth is demonstrating to customers that the new machine they buy will bring them some measurable ROI.
A lot of OEMs have traditionally done this in the sales process by looking at case studies, use cases, industry metrics, and white papers. Unfortunately, as we all know, sometimes the customers just aren’t buying it (literally).
Selling what you think the ROI will be is a tough road for anyone; including OEMs, but proving it with hard data can put you a step ahead of the competition. I mean really prove it.
This is what some really smart OEMs are starting to do and it makes total sense.
Prove the Value Your Machines Would Provide to Customers
Imagine, an OEM’s sales staff walks into a customer location and is able to show that their company’s machines have parts that take months longer to wear out than a competitor.
Because of actual machine monitoring data, OEMs can highlight exactly how these machines operate and demonstrate the reliability of their parts vs. the competitor; providing the customer with real data and info on how they would save money by using that OEMs machines.
This kind of transparency is what machine buyers are looking for. In a world where manufacturers are concerned about downtime and throughput, the ability to understand exactly how a machine can be used to improve these manufacturing KPIs is vital.
By monitoring existing customer machines, OEMs can see exactly how their machine performs on actual shop floors and walk into customer locations knowing:
- How quickly parts wear out, and how the machines run when they do
- How often machines have to be replaced
- The optimal frequency for machine maintenance
- What conditions lead to optimal performance for different goals
Giving Prospective Buyers Objective Data
The answer is in the heading above, data. The goal of forward-thinking sales and product departments is thinking about how they can show customers hard ROI on the spot; rather than collecting data from existing customers and hoping customers see how it would translate to their business.
“How in the heck do we do that?”
Yeah, obviously this is what you want to do. So how do you do it?
The secret lies in knowing what a prospect or customer is doing, you can actually help them generate better ROI and prove cost payback faster. If you understand how your machine is running, being used, and being taken care of while it sits on their shop floor, you could easily coach them to guaranteed ROI.
This is something you already know. Most OEMs in the sales process know that under the right circumstances, their products could replace or be introduced in a way that easily produces ROI for the customer. The problem is that the customer may not be effectively leveraging the machine properly; nor do they have the capacity and wherewithal to do this.
That’s where OEMs could potentially help. By looking at machine analytics, you could figure out exactly what would be needed to generate ROI and coach the customer to successful ROI. An objective success metrics that both the OEM and the customer could agree upon.
Use Case: See Machine Monitoring in Action on Customer Floors
Understanding the optimal setting of the machine and when expensive parts need to be replaced can provide OEMs with two valuable pieces of cost-saving information for their customers and prospects.
- The optimal configuration for part-longevity and machine performance (increasing uptime)
- This is something that can be easily objectively measured and calculated
- The cost-savings associated with this reliability vs. a competitor or a previous configuration
Also, having high-level performance information is great, but what is also proving to be helpful is an understanding of the detailed parameters and settings of a machine when a problem happens.
Using this information capital equipment manufacturers can more quickly diagnose and fix issues, getting customers up and running more quickly. For example, capital equipment manufacturers can measure:
- Tool Life
An Easier Sale for Original Equipment Manufacturers
Delivering this in the sales process would be a home run. Imagine you’re a business development professional for an OEM, and in the sales discovery process you can build out a perfect plan for what ROI would need to be achieved to make the sale. You could then show them exactly how that would take place and give them real data on progress and help as you go.
Additionally, after the sale, you could actually then take their behavior and machine use and feed it back to your design/engineering team to improve the way they design and build machines. You could actually build the machines better so that they generate ROI faster and more in line with the way customers use them.
Under this model, OEMs can apply a more data-driven sales approach, help their engineers build better products, and agree with customers before the sale on what ROI will be and how to get there. This is something manufacturers have been clamoring for and OEMs are just now figuring out how to give it to them.
Solving Problems Through Better Sales
Right now the model is very reactive for the service and support of existing machines. A customer comes to you and says they have a problem; likely weeks after it happens. This means the ROI could be shot and could lose a customer — or future sales. By knowing about these problems in real-time, you can prevent these issues before they even happen and advise customers on best practices…. proving ROI.
How Does OEM Analytics Data Work?
KNOW how fast a machine runs, the uptime, real ROI behind why it is worth it to replace an existing machine with a new one. This will allow OEMs to have a complete data-driven sales process and a better product value proposition.
Instead of anecdotal evidence from existing customers about improvements in uptime and speed — which may be apples to oranges for certain businesses — advanced analytics will allow OEMs to be able to show them exactly what improvements were made using exact metrics, and prove exact cost payback of those improvements, the amount of time it took for the machine to pay for itself, and the long term profitability to the implementation. Paint by numbers using data for the sales process.
This gives your customers the case for them on the spot. This will allow them to more easily justify the cost of the machine to any higher-ups or shareholders. It can shorten the sales process and allow your salespeople to present a better value proposition.
It’s Easy and It’s Changing the OEM Landscape
Monitoring machines on customer factory floors are a popular trend. It’s an easy way to provide objective and tangible data to customers around how they will be able to financially benefit from the machines and services offered by the OEM.
The key difficulty in implementing these practices has been around several key challenges.
- Customer firewall and security concerns
- Outfitting existing machines in a way that makes it easy to collect this data
Fortunately, technology providers like Mingo have created affordable and simplified solutions for OEMs that make implementing everything from software to hardware easy. These kinds of new lightweight solutions include everything from software to hardware and can usually be implemented in less than 7 days without ever violating any security or firewall concerns on the part of the customer.
This is making customer machine monitoring on customer shop floors one of the brightest new trends in the OEM marketplace.
See how you can become a data-driven business by viewing the Mingo OEM Analytics demo.